Helena Talbot's blog - 10 Credit Dos and Don'ts When Applying for a Mortgage

Securing a mortgage in today’s dicey lending environment can be challenging. Lenders have raised the bar on credit scores so it’s critical to have the highest credit rating possible in order to obtain the best interest rates and terms on a mortgage.

There are many factors that can lower your credit score that you may not even be aware of. Credit-repair professional Peter Nagy suggests abiding by the following 10 credit dos and don’ts when applying for a mortgage or refinance:

1. Don’t apply for new credit. Every time you have your credit pulled by a potential creditor or lender, you can lose points from your credit score immediately.
2. Don’t pay off collections or “charge offs.” If you want to pay off old accounts, do it through escrow, making sure that the debt is yours. Request a “letter of deletion” from the creditor.
3. Don’t close credit card accounts. If you close a credit card account, it may appear that your debt ratio has gone up. Closing a card will affect other factors in the score, including credit history.
4. Don’t max out or overcharge credit card accounts. Try to keep your credit card balances below 40 percent of their limit during the loan process. If you pay down balances, do it across the board.
5. Don’t consolidate your debt. When you consolidate all of your debt onto one or two credit cards, it will appear that you are “maxed out” on that card and you will be penalized.
6. Don’t do anything that will cause a red flag to be raised by the scoring system. This includes adding new accounts, co-signing on a loan or changing your name or address with the bureaus.
7. Do join a credit watch program. Then, you may check your own credit reports regularly (you won’t get dinged for a “hard” inquiry). Plus, if something unexpected does show up, you can address it promptly.
8. Do stay current on existing accounts, such as your mortgage and car payments; one 30-day late notice can cost you.
9. Do continue to use your credit as you normally would. Red flags are raised easily in the scoring system. If it appears that you are changing your pattern, it will raise a red flag and your score could go down.
10. Do consult your financial advisor or accountant. Find out what resources are available to you to help stop any derogatory reporting to the bureaus.

I specialize in helping buyers and sellers invest in real estate in Loudoun County and Northern Virginia. 

I have over 25 years experience in the real estate industry.  As a Broker/Owner with Exit Realty Talbot and Company, I bring special tools and solutions that enable me to exceed the expectations of my clientele.  If you are considering listing your property in Loudoun County or the nearby areas, ask me about our latest internet marketing systems.  I would appreciate the opportunity to earn your business.  I am experienced in listing and selling short sales.  For information on the short sale process, please visit  www.LoudounShortSaleSolutions.com.

My past awards and designations include – 2003 President of the Dulles Association of Realtors, 2003 Dulles Area Assoc Realtor of the Year, Salesperson of the year 2000 Dulles Area Assoc of Realtors,  Top Producer awards from both the Dulles Area Association and the Northern Virginia Association of Realtors.  I am a member of the Top 5 in Real Estate Network.

I have lived in Loudoun County since 1979.  I am married with two grown children and two grandchildren.  My son in law is my business partner in real estate.  I love to jog in the mornings and spend time relaxing on my Trawler during the summer months.

Loudoun County and Northern Virginia Real Estate Sales and Solutions – Helena Talbot, Broker. I specialize in helping buyers and sellers invest in real estate in the Northern Virginia area to include Loudoun County and surrounding areas including Fairfax, Clarke, Fauquier, Prince William  Counties.  Our local neighborhoods include Leesburg, Ashburn, Sterling, Potomac Falls, Brambleton, Broadlands, Lansdowne, River Creek, Belmont Country Club, Beacon Hill, Shenstone, Waterford, Lovettsville, Purcellville, Hamilton, Round Hill and Bluemont.                        Cell 703.727.9885    Office 703.574.3800   www.facebook.com/LoudounCountyConnect  www.twitter.com/ExitAshburn  www.Linkedin.com/in/HelenaTalbot